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In these economic times, it is very likely that many taxpayers may have fallen behind on their taxes. The tricky part about owing the IRS money is that when they ask you to pay up, you end up owing them more than just your back taxes–you will also need to pay extortionate amounts of penalties and fees on top of it all.

The good news for those taxpayers who owe more back taxes than they can afford is that there is a way out of IRS debt for good.

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Question: Hi, I have an old tax bill from the year 2000 that I had to refile for some years ago, the IRS is saying that I owe for fines and penalties. The tax bill has ballooned up to $8,505.45 and they have also put an IRS levy on my credit. I have been reading that after 10 years they can no longer collect for back taxes. Now that it is 2010, does that mean that my 2000 tax bill is no longer collectable by them? And can the levy also be removed?

Thanks for your help.

Answer: Whether or not the IRS can still collect from you depends when you filed 2000. The IRS has 10 years from date of initial assessment (this should be pretty close to your filing date) to collect their money. This is called a Statue of Limitations and it is a great way for you to resolve your back taxes for good. After the 10 years pass from the date of your initial assessment, the IRS can no longer come after your money. An audit assessment, if it increased the tax bill for that year, has its own 10 year CSED date from date of the new audit assessment.

The best thing to do is to figure out your exact initial date of assessment and see if the 10 years has passed. If you have a second assessment date from the audit that has not yet expired due to the Statue of Limitations, then you are still liable for the money owed from that audit. If however, all your assessments have expired their 10 year statues, you are not liable for paying any of your taxes anymore.

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I deal with IRS problems such as yours every day. For a free, no-risk tax resolution consultation, please call my office at 866-477-7762 or visit www.taxresolution.com

More Tax Help, IRS News and Tax Relief Tips:

1. Tax Help News: IRS Enforcement to Get Priority, Big Bucks in 2010
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3. Tax Help: How to Resolve Your Back Taxes & Prevent Tax Problems If You’re Short on Cash This Season
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Tags: ask the tax expert, Back Taxes, delinquent taxes, irs assessment, IRS audit, IRS debt, IRS help, Michael Rozbruch, statue of limitations, tax attorney, tax expert, tax help

This entry was posted on Friday, February 5th, 2010 at 10:12 am and is filed under Ask the Expert, Back Taxes, Delayed IRS Collection and Currently Not Collectible St, Expert Help From Tax Attorney, Expiration of the Collection Statute, IRS help, Offers in Compromise, Tax Debt Help News, Tax Relief News, Tax news and tips, Unfiled Returns - Delinquent Tax Returns, Working with the IRS, income tax relief, tax help. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.